20 Silicon Valley Startups Raised $748.9 Million - Week of October 28, 2024

💰 How AI Dealmakers Are Sidestepping Regulators 💰 Biggest Crypto Acquisition for $1.1B 👶 Could Your Baby be Smarter? ☀️ The Rise of Small Language Models 🗞️ No Presidential Endorsement

Oct 28, 2024

Hello from Saudi Arabia! 🇸🇦

I am speaking at FII (Future Investment Initiative) Riyadh on the topic of “When will the IPO outlook turn positive?” and “How will Women Drive the 5th Industrial Revolution”. I hope to catch up with some of you there!

P.S. Apply to attend 👉 How to Recruit, Build, and Scale World Class Engineering Teams on November 6.

Here are a few great things to read/watch this week:

💰 How AI Dealmakers Are Sidestepping Regulators - Startups like Inflection, Adept and Character.AI use a number of tricks to get their total assets below $23.9M to strike deals with Microsoft, Amazon and Google, respectively, to avoid antitrust scrutiny. Under the US’ Hart-Scott-Rodino Act, antitrust authorities don’t need to be notified if the value of an acquisition is below $119.5 million. If the deal’s value is higher—between $119.5 million and $478 million—the parties involved only have to notify authorities if one company (likely the acquirer) has at least $239M in annual net sales and the other company has at least $23.9M in annual net sales or total assets. Read more here and here.
💰 Biggest Crypto Acquisition for $1.1B - Stripe acquired the stablecoin platform Bridge for $1.1 billion gave some credence to the idea that stablecoins might be the killer use case for crypto. This acquisition comes a few days after Stripe formally announced it had re-enabled crypto payments in the US with stablecoins. Stablecoins show promise for money transfers and payments — and Solana’s north star of being fast and cheap makes the blockchain an intuitively good fit. See this analysis on implications for Solana and crypto VC.
(Full disclosure: I am an investor in Solana)
👶 Could Your Baby be Smarter? US Startup Promises Higher IQs in Embryos for $50,000 - Heliospect Genomics, has worked with more than a dozen couples undergoing IVF. The company is marketing its services at up to $50,000 for clients seeking to test 100 embryos, and claiming to have helped some parents select future children based on genetic predictions of intelligence. Read more.
☀️ The Rise of Small Language Models - SLMs are pared-down versions of the large language models that underpin generative AI technology—are gaining traction and opening investment opportunities. These models are everything LLMs like ChatGPT and Claude aren’t. They’re considered “small” because they’re trained using less data. They’re cheaper to run and can be deployed on local devices. They don’t have access to an internet’s worth of knowledge, but what they lack in breadth they make up for in depth. Read more here and here
🗞️ No Presidential Endorsement for Jeff Bezos & Patrick Soon-Shiong - The Washington Post and Los Angeles Times both won’t endorse a presidential candidate, ending decades of tradition. Jeff Bezos bought the Washington Post for $250 million in 2013 and Patrick Soon-Shiong bought the LA Times for $500 million in 2018. Los Angeles Times editorials editor resigns after owner blocks endorsement.
🖐️ Every Board Member Resigned from 23andMe - Seven of eight members of 23andMe’s board have resigned in yet another blow to the struggling genetics company. Co-founder and CEO Anne Wojcicki is now the only remaining member. The independent directors were quitting the company’s board after not receiving a satisfactory buyout offer from the CEO. Read here.